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Shoppers last month shrugged off the uncertainty that followed Britain’s vote to leave the EU, as retail sales rose by a far bigger than expected 1.5 per cent month-on-month in July, rebounding from a 0.9 per cent fall the previous month.

The Office for National Statistics said sales last month were supported by better weather while there was some anecdotal evidence that the sharp slide in the pound after the Brexit vote encouraged tourists from overseas to spend more while on holiday in the UK, writes Nathalie Thomas.

Sales, excluding petrol, were also 5.4 per cent higher by volume than a year earlier in July. This followed a 3.9 per cent annual rise in June, when sales growth cooled significantly from 5.2 per cent in May.

Economists had been expecting a more modest 0.3 per cent recovery in monthly sales, excluding petrol, and year-on-year growth to remain stable at 3.9 per cent.

Including petrol, sales rose 1.4 per cent month-on-month and 5.9 per cent year-on-year.

The retail sales data will add to the mixed bag of economic releases and surveys that have been published since the Brexit vote and don’t yet offer a clear picture of how the economy will be affected by the surprise victory for the “leave” campaign.

The Bank of England this month cut interest rates to a fresh historic low of 0.25 per cent and resumed quantitative easing as part of a broad stimulus package designed to protect the UK economy against a sharp shock following Britain’s vote to leave Europe.

Joe Grice, chief economic adviser at the ONS, said of the latest retail sales figures:

These are strong numbers showing a pronounced increase in sales compared with last July. Better weather this year could be a major factor with sales of clothing and footwear doing particularly well. There is also anecdotal evidence from respondents suggesting the weaker pound has encouraged overseas visitors to spend. Department stores and specialist retailers like jewellers are among those reporting a good month.